| Since the reform and opening up, China efforts to accelerate the process of industrialization, and raises manufacturing rapidly, which makes manufacturing gained rapid development. The ability to absorb employment of manufacturing can not be compared by other sectors’ of national economy. For the United States, although the proportion of manufacturing output in its GDP declines gradually, manufacturing is still the main driver of economic growth and the important foundation of national competitiveness in U.S.. However, affected by the global financial crisis in2008, manufacturing exports of China declines sharply, and massive jobs are lost. Solid manufacturing of U.S. also continues to slump. Although the manufacturing productivity improvements and scale expansion of China leads domestic jobs growth, it also causes a certain amount of RMB appreciation pressure. As well as influenced by other factors, the cumulative appreciation of RMB exchange rate has been up to30%since the reform of RMB exchange rate regime in2005.Faced with the economic reality, the U.S. government still puts pressure on the RMB exchange rate through diplomatic channels, and considers that China uses significant RMB exchange rate undervalued to gain trade competitive advantage which leads textile and other traditional manufacturing of U.S. shrinks, and a large number of manufacturing jobs are lost. The U.S. government thinks that forcing RMB exchange rate to appreciate continually is the only one method to solve this problem. Thus, facing with the domestic and international background of continued RMB exchange rate appreciation pressure and the U.S. implementing "to revive the manufacturing", researching on impact of RMB exchange rate changes on Sino-US manufacturing employment and wage has important practical significance.This dissertation is intended to research the impact of RMB exchange rate changes on Sino-US manufacturing employment and wage based on the paradigm of dynamic general equilibrium, and the main issues to be addressed are:First, through which transmission mechanisms, RMB exchange rate changes can affect Sino-US manufacturing overall or sub-sectors employment and wage, and what the effects are. Second, according to the industry characteristics, this dissertation divides Sino-US manufacturing sub-sectors into several characteristic industries, and then researches on the impact of RMB exchange rate changes on employment and wage of Sino-US manufacturing characteristic industries and studies the function of industry characteristics in this process. Third, this dissertation studies that in addition to RMB exchange rate, which other domestic factors can affect Sino-US manufacturing employment, and what’s the effect of RMB exchange rate and other domestic factors on Sino-US manufacturing employment.According to the analysis above, this dissertation establishes dynamic equilibrium model of labor market of small country and major country to derive the transmission mechanisms of RMB exchange rate changes influencing Sino-US manufacturing employment and wage and the RMB exchange rate calculation formula on the basis of recognizing relevant literature, and estimates the RMB exchange rate by using present value method, decomposition method and weighting method respectively. Then utilizing ridge regression, this dissertation dose empirical research on the impact of RMB exchange rate changes on Sino-US manufacturing overall or sub-sectors employment and wage, and studies the function of industry characteristics in this process. Meanwhile, this dissertation observes the main factors which influence Sino-US manufacturing employment by constructing labor demand and supply model, and then through Johansen co-integration Test, vector error correction model Test, impulse response analysis and variance decomposition, this dissertation analyzes the impact of RMB exchange rate changes and Sino-US domestic factors on Sino-US manufacturing employment.Compared with the existing literature, innovations of this dissertation express in the four aspects as follows:Firstly, this dissertation not only examines impact of national currency or regional currency on national or regional employment, but also jumps out of the circle and examines impact of national currency or regional currency on other countries’ or regions’employment. In other words, this dissertation establishes dynamic equilibrium model of labor market of small country and major country in order to investigate the impact of exchange rate changes on employment and wage under the condition of small country and major country. This dissertation establishes continuous time model to depict dynamic changing process of variables.Secondly, through establishing dynamic equilibrium model of labor market of small country and major country, this dissertation not only derives the transmission mechanisms of exchange rate changes influencing employment and wage but also derive the exchange rate calculation formula. On this basis, this dissertation estimates the RMB exchange rate by using present value method, decomposition method and weighting method respectively, and compares and analyzes the outcome of exchange rate estimation in order to ensure that the exchange rate indicator used in empirical studies and used in theoretical models is consistent.Thirdly, this dissertation not only dose research on impact of RMB exchange rate changes on Sino-US manufacturing overall or sub-sectors employment and wage, but also divides Sino-US manufacturing sub-sectors into several characteristic industries according to industry characteristics, and then researches on impact of RMB exchange rate changes on employment and wage of Sino-US manufacturing characteristic industries and studies the function of industry characteristics in this process.Fourthly, on the basis of the analysis above, this dissertation observes the main factors which influence Sino-US manufacturing employment by constructing labor demand and supply model, and then through Johansen co-integration test, vector error correction model test, impulse response analysis and variance decomposition, this dissertation analyzes the impact of RMB exchange rate changes and Sino-US domestic factors on Sino-US manufacturing employment, and tries to find that which factor is the source of influencing Sino-US manufacturing employment.The main conclusions of this dissertation are as follows:First, RMB exchange rate changes can affect manufacturing overall or sub-sectors employment and wage of China through manufacturing industry imported input level and export share. RMB exchange rate depreciation can lead manufacturing overall or sub-sectors employment of China increase, and promote manufacturing overall or sub-sectors wage level of China rise. However, RMB exchange rate appreciation can lead to manufacturing overall or sub-sectors employment and wage of China falling. Similarly, RMB exchange rate changes will bring positive effect on the employment and wage of manufacturing characteristic industries classified according to manufacturing industry characteristics of China. In addition, the nature of business activity is an important factor which leads to employment level difference among industry of China; while the average level of education, professional and technical level, the degree of economic monopoly and ownership monopoly can play a decisive role in wage return difference among industry of China.Second, both for manufacturing overall and sub-sector employment of China, when manufacturing labor input level and imported input level rising or export share declining, manufacturing exchange rate elasticity of employment and wage will decrease; when manufacturing labor input level and imported input level declining or export share rising, manufacturing exchange rate elasticity of employment and wage will increase. Therefore, when RMB exchange rate appreciates, Chinese manufacturing enterprises strengthening dependence on imported input, performing labor-intensive production, and reducing export share will offset the adverse effect of RMB exchange rate appreciation on manufacturing employment and wage growth partially; when RMB exchange rate depreciates, Chinese manufacturing enterprises reducing dependence on imported input, performing capital and technology-intensive production, and increasing export share will strengthen the stimulating effect of RMB exchange rate depreciation on manufacturing employment and wage growth.Third, whether in the short-term or in the long-term, technological progress rate rising or per capita capital stock increasing of manufacturing of China can both promote manufacturing employment growth of China significantly, and their contribution is greatest, however, the influence of discount rate of company is weakest, and its contribution rate is minimal. In the short run, manufacturing real wage rate increasing or real interest rate rising of China can both boost manufacturing employment of China increase, however, the influence of former factor is more significant and the latter’s influence is weak. In the long run, the promoting effect of real interest rate decline on manufacturing employment growth is more significant, and its contribution rate is also greater than manufacturing real wage rate.Fourth, RMB exchange rate changes can also affect manufacturing overall or sub-sectors employment and wage of U.S. through manufacturing industry imported input level and export share. RMB exchange rate changes will bring positive effect on manufacturing overall employment of U.S., and will bring negative effect on manufacturing overall wage of U.S., however, RMB exchange rate changes will bring positive effect on manufacturing overall and sub-sectors employment and wage of U.S. Similarly, RMB exchange rate changes will bring positive effect on the employment and wage of manufacturing characteristic industries classified according to manufacturing industry characteristics of U.S.. In addition, the characteristic of labor union is an important factor which leads to employment level difference among industry of U.S.; while the average level of education, professional and technical level, the degree of economic monopoly and ownership monopoly can play a decisive role in wage return difference among industry of U.S..Fifth, both for manufacturing overall and sub-sector employment of U.S., when manufacturing labor input level and imported input level declining or export share rising, manufacturing exchange rate elasticity of employment and wage will decrease; when manufacturing labor input level and imported input level rising or export share declining, manufacturing exchange rate elasticity of employment and wage will increase. Therefore, when RMB exchange rate depreciates, U.S. manufacturing enterprises strengthening dependence on imported input, performing labor-intensive production, and reducing export share will strengthen the stimulating effect of RMB exchange rate depreciation on manufacturing employment and wage growth; when RMB exchange rate appreciates, U.S. manufacturing enterprises reducing dependence on imported input, performing capital and technology-intensive production, and increasing export share will offset the adverse effect of RMB exchange rate appreciation on manufacturing employment and wage growth partially.Sixth, whether in the short-term or in the long-term, technological progress rate rising or per capita capital stock increasing of manufacturing of U.S. can both promote manufacturing employment growth of U.S. significantly, and their contribution is greatest, however, the influence of discount rate of company is weakest, and its contribution rate is minimal. In the short run, manufacturing real wage rate increasing or real interest rate rising of U.S. can both boost manufacturing employment of U.S. increase, however, the influence of former factor is more significant and the latter’s influence is weak. In the long run, the promoting effect of real interest rate decline on manufacturing employment growth is more significant, and its contribution rate is also greater than manufacturing real wage rate.This dissertation reveals the argument that RMB exchange rate undervalued leading rising unemployment in U.S. is lack of theoretical and empirical arguments support, and the logic that forcing RMB exchange rate to appreciate can solve the problem of unemployment in U.S. is untenable. The U.S. domestic economic variables, such as manufacturing technological progress rate, per capita capital stock and U.S. economic structure is the source of influencing manufacturing employment level. Therefore, the key of solving the manufacturing unemployment of U.S. lies in breaking through from domestic economic development sectors, accelerating labor restructuring, and seeking new methods of economic growth, rather than blindly blaming RMB exchange rate. Conclusions of this dissertation provide some theoretical and empirical basis for resolving Sino-US trade disputes in the future, and for external trade negotiations of China. Meantime this dissertation puts forward to a certain amount of inspiration for pulling Sino-US manufacturing overall and sub-sectors employment and wage. On the basis of summarizing relevant research findings, this dissertation puts forward to policy recommendations from the aspects of the RMB exchange rate appreciation policy, leading Sino-US manufacturing overall and sub-sectors employment and wage level growth and preventing Sino-US manufacturing characteristic industry employment and wage gap to expand continually. |
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